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Daňový základ

tax base

What does “Daňový základ” mean in Czechia?

Taxable income (also základ daně) is income minus expenses, not turnover. The confusion "turnover = income" costs entrepreneurs the most.

Arithmetic with an example

Turnover of 800,000 Kč with a 60% expense allowance → expenses of 480,000 Kč → taxable income = 320,000 Kč. This is the same person and the same year, but two very different numbers.

What is calculated from it

Income tax for natural persons (FO): 15% up to 1,762,812 Kč per year (= 36× average wage), above that — 23%. 🔴 The 23% rate is applied only to the excess amount, not to the whole sum — a common mistake in articles.
Social security for self-employed (OSVČ): assessment base = 55% of taxable income, rate 29.2%.
Health insurance for self-employed (OSVČ): assessment base = 50% of taxable income, rate 13.5%.

🔴 Calculator trap

The bases for social and health insurance are different percentages (55% and 50%) of the same number, and also with different payment deadlines. Calculating "55% for everything" means you made a mistake.

Important. When Czech documents ask about income, they almost always mean profit, not turnover. Before you give a number, find out what they are asking for — turnover or tax base: the difference is not small.

Examples of use

The tax base is the difference between income and expenses.

Taxable base is the difference between income and expenses.

The 23% rate applies only to the amount above the limit.

Frequently asked questions

I earned over 1.8 million CZK. Is all of my income taxed at 23%?

No. Up to 1,762,812 Kč, the rate is 15%, and only the **amount exceeding** this threshold is taxed at 23%. This is one of the most common mistakes.

My turnover is 800,000 CZK. Is this my tax base?

No. With the expense allowance of 60%, the expenses are 480,000 CZK, so the tax base = 320,000 CZK. Turnover and base are different numbers, and the documents ask for the base specifically.